Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.

Monday 09.27.2010

Regulators seize 3 failing wholesale corporate credit unions
By Daniel Wagner, Associated Press
WASHINGTON - Federal regulators took over three key lenders to U.S. credit unions, after losses on mortgage investments threatened to topple them. The move was a reminder that parts of the financial system are still burdened by the toxic assets two years after the financial crisis peaked.
The National Credit Union Administration voted Friday to place into conservatorship three corporate credit unions: Members United Corporate Federal Credit Union of Warrenville, Ill; Southwest Corporate Federal Credit Union of Plano, Texas; and Constitution Corporate Federal Credit Union of Wallingford, Conn.

Credit Unions Bailed Out
U.S. Backs $30 Billion in Bonds to Stabilize Key Institutions;
Subprime Legacy
By MARK MAREMONT And VICTORIA MCGRANE - WSJ.com (free)
Two years after the peak of the financial crisis, the federal government swooped in to stabilize a crucial part of the credit-union sector battered by losses on subprime mortgages.
Regulators announced Friday a rescue and revamping of the nation's wholesale credit union system, underpinned by a federal guarantee valued at $30 billion or more. Wholesale credit unions don't deal with the general public but provide essential back-office services to thousands of other credit unions across the U.S. The majority of retail credit unions are sound, but they will have to shoulder the losses through special assessments over the next decade.

North County Bank, Arlington, Washington, becomes the 127th ailing bank on the FDIC hit list for 2010. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $72.8 million.
North County Bank, Arlington, Washington, was closed today by the Washington Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Whidbey Island Bank, Coupeville, Washington, to assume all of the deposits of North County Bank.

Haven Trust Bank Florida, Ponte Vedra Beach, FL
September 24, 2010 - 5:08 pm
The 126th FDIC-insured institution to croak in the nation this year, is also the 24th in Florida. Haven Trust Bank Florida, Ponte Vedra Beach, FL, was shuttered by the agency tonight at an estimated cost to the Deposit Insurance Fund (DIF) of $31.9 million.
Haven Trust Bank Florida, Ponte Vedra Beach, Florida, was closed today by the Florida Office of Financial Regulation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First Southern Bank, Boca Raton, Florida, to assume all of the deposits of Haven Trust Bank Florida.

Bank of Granite is facing possible Nasdaq delisting
By RICHARD CRAVER, RICHARD CRAVER | Winston-Salem JOURNAL
For the second time in a year, Bank of Granite Corp. is facing a potential delisting from the Nasdaq Stock Market.
The bank, based in Granite Falls, has its mortgage operation and a branch on Jonestown Road in Winston-Salem.
The bank said yesterday that it received notice Wednesday from Nasdaq that because the bid price on its stock has been below $1 a share for 30 consecutive business days, it "no longer complies with the minimum bid price requirement for continued listing."

Trashing the dollar to save the economy
By Tom Petruno - Market Beat - LATimes.com
Most Americans have never traveled abroad. U.S. economic policy may guarantee that your dream trip remains deferred.
If something's got to be sacrificed to put the domestic economy on the road to a sustainable recovery, the dollar's value against other currencies seems a good candidate.
That's what the Federal Reserve signaled this week - and what Congress, in no uncertain terms, is telling the Chinese.
A new devaluation of the buck carries risks. Always high on any Wall Street list of potential calamities is the idea of a sudden collapse of the dollar. That still seems remote, though perhaps less so than in the past.

Gold is the final refuge against universal currency debasement
States accounting for two-thirds of the global economy are either holding down their exchange rates by direct intervention or steering currencies lower in an attempt to shift problems on to somebody else, each with their own plausible justification. Nothing like this has been seen since the 1930s.
By Ambrose Evans-Pritchard - Telegraph.co.uk
"We live in an amazing world. Everybody has big budget deficits and big easy money but somehow the world as a whole cannot fully employ itself," said former Fed chair Paul Volcker in Chris Whalen's new book Inflated: How Money and Debt Built the American Dream.
"It is a serious question. We are no longer talking about a single country having a big depression but the entire world."
The US and Britain are debasing coinage to alleviate the pain of debt-busts, and to revive their export industries: China is debasing to off-load its manufacturing overcapacity on to the rest of the world, though it has a trade surplus with the US of $20bn (£12.6bn) a month.

The global politics of gold
FinanceAndEconomics.com
Very little attention is given to the global political consequences of the strength of gold, but we can be sure that the strategy analysts in the Pentagon and elsewhere are acutely aware of the difficulties created between the old communist bloc on one side, and America, the UK and Europe on the other. If they are not, they are not doing their job at a time when they know Russia is running spy networks in the US, and possibly knows what is left in Fort Knox down to the bar. The ex-communists are playing from a position of increasing strength, and the West from weakness; but the issues are complex, requiring some deductive guess-work.

$1,300? Some say gold may hit $2,300!
By Paul R. La Monica
NEW YORK (CNNMoney.com) -- Gold finally traded above $1,300 an ounce Friday morning. So is that the peak or can the precious metal actually head even higher?
As tempting as it is to say that gold is an absurdly overvalued yellow bubble, several pretty savvy people say there are compelling reasons for gold to keep climbing.
Some investors are worried that the Federal Reserve's commitment to buying more Treasurys could mean higher inflation down the road. So far, inflation has not been a near-term problem. And the chart at the top of this page clearly shows that gold can go up without inflation pressures.

Gold's next hurdle is 1980's inflation-adjusted peak
By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold hit a long-anticipated high-water mark Friday, briefly breaking through $1,300 an ounce. But the precious metal still has a long way to go to reclaim its inflation-adjusted all-time highs.
A gold investor who bought an ounce of the metal at its January 1980 peak would need gold to advance by more than $1,000 an ounce from today's record levels to come out ahead when 30 years of inflation are taken into account.

The Hedge Funds are Buying Gold for a Reason
By: Ivory Johnson - CNBC.com
Many experts have called gold a bubble for the last five years, even as it outperformed the equities' market by almost 200 percent during the same time frame. Others, on the other hand, believe it is being manipulated for a quick profit at the expense of retail investors.
The truth is the United States Treasury must refinance 36 percent of the debt this year and 60 percent by 2013, and unlike Greece who can't print money to refinance their obligations, the United States Federal Reserve has no such restraints.

Sentiment remains positive towards gold, silver
By Debbie Carlson of Kitco News - Commodity Online
(Kitco News) - Gold and silver hit milestones this week, with gold breaching $1,300 an ounce and silver a 30-year high, investor sentiment remains positive toward to the precious metals.
Silver is outpacing gold and has for the week and so far for the month. Looking at the futures on the Comex division of the New York Mercantile Exchange, December silver is up 10.1% on the month and closed the week with a 2.8% rise, settling at $21.399. Gold, meanwhile, is up 3.8% this month and gained 1.6% this week, settling at $1,298.10.

Nothing can stop bullion bull
LONDON (Commodity Online): If you go through a Financial Times report on gold, you will be busy putting all your money in gold basket by now.
According to the leading business paper, gold is heading for more records and the prices can any time breach the psychological barrier of $1,300 per ounce next week.
Gold was trading at $1,296.85 on Friday in London. Before this gold had already set five new records in this week itself. According to Financial Times, the reasons for the latest bull run in bullion are fears that renewed monetary easing by the Federal Reserve could lead to sharp falls in the US dollar and, eventually, a jump in inflation have sent the gold price to a string of record highs this week.

IRAN: Gold bazaar on strike
as merchants square off with government over tax hike
LATimes.com
Tehran's main gold bazaar is usually glittering with precious baubles and jewelry fit for royalty, but the last several days have seen it shuttered and empty as the union of goldsmiths and jewelers strikes against a 3% value-added tax.
"We'll stay on strike until the negotiation gets results," Ali Mosavi, a goldsmith in the bazaar, told Babylon & Beyond. "This is the third year we are protesting and so far we have been able to resist [the tax hike]."
The strike appears to be affecting the retail and wholesale gold markets of Tehran's main bazaar as well as the markets of other Iranian cities like Esfahan, Mashhad and Tabriz, but not non-union jewelry stores outside the bazaars.

Oil Rises for Second Day as Dollar Slump Boosts Commodities
By Christian Schmollinger
Sept. 27 (Bloomberg) -- Oil rose for a second day in New York as the dollar dropped against the euro, bolstering the appeal of commodities as an alternative investment.
Crude extended its 1.7 percent gain on Sept. 24 after the euro strengthened against the greenback following a report showing German business confidence at a three-year high. The dollar also slumped as policy makers indicated they may lower interest rates. U.S. durable goods orders not including transportation items climbed more than expected.

Silver Jumps to 30-Year High; Gold Rises to Record, Tops $1,300
By Pham-Duy Nguyen and Nicholas Larkin - Business Week
Sept. 24 (Bloomberg) -- Silver climbed to the highest price since 1980 as the dollar's slump boosted demand for precious metals as alternative assets. Gold climbed to a record, topping $1,300 an ounce.
Silver has jumped 27 percent this year, and gold has gained 18 percent, outperforming global equities, Treasuries and most industrial metals. Today, the dollar fell to the lowest level since February against a basket of six major currencies as the Federal Reserve keeps borrowing costs low and moves closer to easing monetary policy to bolster the U.S. economy.

Silver prices on the verge of a major move to the upside
The long awaited break above the former key resistance level of $18.50 gave an extremely positive sign to silver bulls but, in the short-term, we may see some consolidation.
Author: David Levenstein - MineWeb.com
JOHANNESBURG -
Silver has been on fire in the last few weeks and the price has moved from $17.50 to a hair above $21/oz in six weeks. That is an increase of 20%! Not bad if you have been long, too bad if you have been short.
Last Monday, not only did the grey metal break the psychologically important $20 an ounce level, it remained above $20 for most of the week sending prices of this precious metal to a 30-month high. At the moment there is a lot of momentum in silver as investors snap up bullion bars, bullion coins while funds add silver to their positions, and it seems that there is still some steam left in this current move that may take prices above $21 before we see a pull-back.

Pushing on a String
By: John Mauldin - GoldSeek.com
Let's Shift the Focus
An Invitation to an Inflation Party
Ten Years and Counting
This week the Fed altered their end-of-meeting statement by just a few words, but those words have a lot of meaning. It seems they are paving the way to a new round of quantitative easing (QE2), if in their opinion the situation warrants it. A trillion dollars of new money could soon be injected into the system. Tonight we explore some of the implications of a new round of QE. Let's put our speculation hats on, gentle reader, as we are moving into uncharted territory. There are no maps, just theories, and they don't all agree.

A Red-Alert Threat to the Regime
by Gary North - LewRockwell.com
AUDIT THE GOLD
In 2011, Congressman Ron Paul will introduce a bill in the House of Representatives calling for an audit of the gold held by the Federal Reserve System on behalf of the United States government. If he can successfully promote this bill by the phrase, "Show us the gold!" he will inflict enormous damage on the American Establishment. This damage could conceivably spread to the entire international Establishment, which rests on the sovereignty of the central banks over their domestic governments.
Most of those few Americans who have ever heard of the Federal Reserve System operate under the illusion that the government is sovereign over the FED. On paper, this is true. Operationally, it isn't. We know this, because no government agency audits the FED.

Bernanke Says Financial Crisis Damage Inhibiting U.S. Recovery
By Craig Torres and Joshua Zumbrun
Sept. 25 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said damage from the financial crisis has left the U.S. economy growing at a slower pace than policy makers want even as the central bank's more than $1 trillion in bond purchases have reduced interest rates.
"By buying mortgage-backed securities and Treasuries we did, I think, additionally stimulate the economy," Bernanke said yesterday in response to a question after he spoke at a Princeton University conference.

Signs of accelerating economy not in sight
Upcoming data this week unlikely to boost confidence
By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) - The U.S. recession evidently ended two summers ago, but the millions of Americans still out of work don't want to hear it.
Even though the latest data suggests the U.S. economy is expanding, growth is so slow it's barely noticeable. The nation's unemployment rate of 9.6% stands near a 27-year high and there's little evidence that the economy is gaining steam.
Data for the upcoming week, which includes reports on consumer confidence, manufacturing and personal income, are unlikely to alter the bigger picture. None of those indicators is expected to show sharp movement one way or the other.

Fed chief Ben Bernanke wants closer look at speculative buying
By Jeannine Aversa, Associated Press
WASHINGTON - Fed policymakers must better understand speculative buying in financial markets to help prevent another financial crisis, Federal Reserve Chairman Ben Bernanke said Friday.
Frenzied buying fed a housing bubble that burst, plunging the economy into a recession in 2007, the worst downturn since the 1930s. While many lessons were learned from the crisis, Bernanke, in prepared remarks, said additional research is needed to explain when and why bubbles start.

Why QE2 + QE Lite Mean The Fed Will Purchase Almost $3 Trillion In Treasurys And Set The Stage For The Monetary Endgame
by Tyler Durden - ZeroHedge.com
Recently the debate over when QE2 will occur has taken a back seat over the question of what the implications of the Fed's latest intervention in monetary policy will be, as it is now certain that Bernanke will attempt a fresh round of monetary stimulus to prevent the recent deceleration in the economy from transforming into outright deflation. Whether or not the Fed will decide to engage in QE2 on its November 3 meeting, or as others have suggested December 14, and maybe even as far out as January 25, the actual event is now a certainty. And while many have discussed this topic in big picture terms, most notably David Tepper, who on Friday stated that no matter what, stocks will benefit from QE2, few if any have actually considered what the impact of QE2 will be on the Fed's balance sheet, and how the change in composition in Fed assets will impact all marketable asset classes. We have conducted a rough analysis on how QE2 will reshape the Fed's balance sheet. We were stunned to realize that over the next 6 months the Fed may be the net buyer of nearly $3 trillion in Treasurys, an action which will likely set off a chain of events which could result in rates dropping all the way to zero, stocks surging, and gold (and other precious metals) going from current price levels to well in the 5 digit range.

The American Recovery and Reinvestment Act
Our Tax Dollars at Work
Martin Andelman
On Feb. 13, 2009, Congress passed the American Recovery and Reinvestment Act of 2009 (ARRA). President Obama signed it into law four days later as a direct response to the economic crisis. The ARRA had four immediate goals, according to the government's site:

1. Create new jobs.
2. Save existing jobs.
3. Spur economic activity and invest in long-term growth.
4. Foster unprecedented levels of accountability and transparency in government spending.

Good goals, I would have to say, all of them. So, how's it going? I mean, enquiring minds want to know, right? I would think so.

Treasury Said to Prepare AIG Exit, Repayment Plan for Unveiling
By Hugh Son and James Sterngold
Sept. 27 (Bloomberg) -- The U.S. Treasury Department may announce plans as early as this week to return American International Group Inc. to independence and recoup taxpayer money from the insurer's bailout, according to three people with knowledge of the talks.
The biggest part of that strategy is for Treasury to begin converting its $49 billion preferred stake into common stock for sales by the first half of next year, said the people, who declined to be identified because the negotiations are private. The timing of an announcement depends on the pace of talks between regulators and the New York-based insurer, and discussions may extend beyond this week, the people said.

Low Inflation Not Always Deflation Risk
By: Reuters via CNBC.com
Low U.S. inflation is not necessarily a deflation risk, a top Federal Reserve official said on Friday, according to Market News International.
Jeffrey Lacker said the United States could experience underlying inflation between 1 percent and 1.5 percent without running the risk of falling into the prices spiral that has plagued the Japanese economy for years, Market News said.

Dollar Trades Near 5-Month Low on Expectations Economy to Slow
By Yoshiaki Nohara
Sept. 27 (Bloomberg) -- The dollar traded near a five-month low versus the euro as expectations the economy will slow added to speculation the Federal Reserve will ease monetary policy.
The dollar was close to a one-week low against the yen before U.S. reports forecast to show the economic activity fell and consumer confidence dropped. The yen slid against higher- yielding counterparts after commodities and global stocks advanced, sapping demand for Japan's currency as a refuge.

THOSE WHO KNOW WILL UNDERSTAND
by JR Nyquist - FinancialSense.com
According to some experts the U.S. economy is one "event" away from a catastrophic sequence. My own variation on this sequence goes something like this: first, the dollar collapses; second, the government's response prevents any chance for recovery; third, political unrest and destabilization begins; last, the defensive function of the state fails as external and internal enemies take advantage of the country's weakness. This sequence would likely be nonsense if it were only my sequence. Unfortunately, it is a sequence dreamt up by Soviet strategists as far back as the 1960s. It was the entire basis of the Soviet strategic blueprint of half a century ago. The writings of at least two Soviet Bloc defectors suggest that this same blueprint dictated the controlled "collapse" of Communism in Eastern Europe from 1989-91. This would differ from the uncontrolled collapse of capitalism that Soviet strategists also anticipated.

PIIGS roast: Euro debt fears return
By Paul R. La Monica
Ireland's gross domestic product fell in the second quarter. Since Ireland is one of the I's in the so-called group of troubled PIIGS nations in Europe -- Portugal, Italy, Greece and Spain make up the rest of the club -- that is not good news.
The Ireland GDP report, which was released Thursday, wasn't the only bit of troubling data from Europe either. A key index of European purchasing manager activity by research firm Markit fell sharply from August to September and was lower than what economists were expecting.

Congress Ban on Rating Delays U.S. Implementing Basel
By Yalman Onaran
Sept. 24 (Bloomberg) -- A 24-line section of the 848-page Dodd-Frank Act is delaying U.S. implementation of international rules for how much capital banks need to hold against securitized assets.
The financial-overhaul legislation, signed by President Barack Obama in July, requires regulators to remove all references to credit ratings of securities from their rules. Revised standards on how much capital banks need to hold against such assets in their trading books, approved by the Basel Committee on Banking Supervision in 2009, rely on such ratings.

On the Secret Committee to Save the Euro, a Dangerous Divide
By MARCUS WALKER, CHARLES FORELLE and BRIAN BLACKSTONE
BRUSSELS - Two months after Lehman Brothers collapsed in the fall of 2008, a small group of European leaders set up a secret task force - one so secret that they dubbed it "the group that doesn't exist."
Its mission: Devise a plan to head off a default by a country in the 16-nation euro zone.
When Greece ran into trouble a year later, the conclave, whose existence has never before been reported, had yet to agree on a strategy. In a prelude to a cantankerous public debate that would later delay Europe's response to the euro-zone debt crisis until the eleventh hour, the task force struggled to surmount broad disagreement over whether and how the euro zone should rescue one of its own. It never found the answer.

Three reasons to cheer inflation
Posted by Nin-Hai Tseng, Fortune
The Fed says it's willing to do what it takes to boost the economy, even if that means encouraging inflation. Here's how that could do the trick.
Paying higher prices for everyday items might not be a welcome development to the millions of cash-strapped and jobless Americans. But as some economists have rightfully argued, a little inflation could actually help stimulate the economy at a time of very slow growth.
True, monetary policies encouraging higher prices aren't always a good thing. In fact, it often makes people feel poorer as the price of everything from cars to TVs rise. Higher inflation weakens the U.S. dollar, since a buck buys less as prices rise. Also, if you've been socking your money away in a bank account, inflation will reduce the value of those savings.

Obama's Stimulus Plan Made Crisis Worse, Taleb Says
By Frederic Tomesco
Sept. 25 (Bloomberg) -- U.S. President Barack Obama and his administration weakened the country's economy by seeking to foster growth instead of paying down the federal debt, said Nassim Nicholas Taleb, author of "The Black Swan."
"Obama did exactly the opposite of what should have been done," Taleb said yesterday in Montreal in a speech as part of Canada's Salon Speakers series. "He surrounded himself with people who exacerbated the problem. You have a person who has cancer and instead of removing the cancer, you give him tranquilizers. When you give tranquilizers to a cancer patient, they feel better but the cancer gets worse."

Senate Will Not Vote on Extending Bush Tax Cuts Before Election
By HUGH COLLINS - DailyFinance.com
The Senate will not vote on extending any of the Bush-era tax cuts until after the November election.
"Democrats believe we must permanently extend tax cuts for the middle-class before they expire at the end of the year, and we will," Jim Manley, a spokesman for Senate Majority Leader Harry Reid said in an e-mail, Reuters reported.

Right to Rent legislation aims to slow foreclosure rate
TheTruthAboutMortgage.com
New legislation that would allow struggling homeowners to rent their homes would slow the foreclosure rate, according to a report from the Center for Economic and Policy Research (CEPR).
"With roughly one-in four mortgages underwater, the loan modification plans put forth so far have done little to help homeowners facing foreclosure," said Dean Baker, Co-Director of CEPR and an author of the report, in a release.
"Right to Rent, on the other hand, would benefit millions, provide families with real housing security, and could go into effect immediately."
The report analyzed the costs of renting versus owning a home in a number of major metropolitan cities and found that it's often much lower than the cost of ownership.

Obama health care reform imposes 3.8% tax
on all income from home sales and home rental income
by Mike Adams, the Health Ranger
(NaturalNews) The news about Obama's health care reform just keeps getting worse -- and we only find these things long after the bill has passed, of course. The newest revelation concerns a 3.8% tax on income from home sales and home rentals which will go into effect in 2013. (Note: This story has been updated to clarify who the 3.8% tax impacts, see below.)
Depending on your income level, this could end up costing you thousands of dollars from the sale of a home (even if you're a middle-class income earner). It would also place a tax burden on all rental income from any home you might rent out to others.

Housing Market:
one more reason for Bernanke to fire up the printing press
Evaldo Albuquerque - WorldCurrencyWatch.com
This year I took advantage of the tax credit for first time home buyers. But it wasn't an easy decision to make. I was really concerned that prices could fall another 10 to 15%.
But the tax credit and the fact that I was looking for a place to live (and not just an investment) made me pull the trigger. But now that the tax credit has expired, my fears of a further decline in prices are becoming more and more real.
Housing demand plummeted in July after the tax credit expired. And there are so signs of recovery. There won't be anytime soon. High unemployment and looming foreclosures will continue to put pressure on house prices.

New-Home Sales Stumble to Second Lowest Level Since 1963
By JOSEPH LAZZARO - DailyFinance.com
It was, to paraphrase Shakespeare, the summer of our discontent in the U.S. housing sector: August's new-home sales clocked in at a 288,000-unit annual rate, unchanged from July's revised rate, and the second lowest level in 47 years.
The consensus prediction of economists surveyed by Bloomberg had been that new-home sales would rise to a 290,000-unit annual pace in August. New homes sales were revised to 312,000-unit and 282,000-unit paces in June and May, respectively, making the May level the new all-time low.

Big Banks May Be Forced to Buy Back Bad Mortgage Loans
BY DON MILLER, Associate Editor, Money Morning
Major U.S. banks are under pressure from government officials, as well as groups of investors and insurers, to repurchase or modify bad mortgage loans they pooled into securities and sold to unwitting buyers.
In the latest effort, a group of investors with roughly $500 billion invested in 2,300 mortgage securities is trying to force the large banks that originated or are now servicing faulty subprime-mortgage loans to repurchase or modify them, The Wall Street Journal reported.
Some investors "had no idea that their money was being invested in mortgage-backed securities," Dallas-based attorney Talcott Franklin told The Journal. "And yet somehow these people are now the ones being punished, and that's just not right."

FORECLOSURE FRAUD LETTER TO FANNIE MAE
FROM GRAYSON, FRANK and BROWN
This should send a powerful message to each and every Foreclosure Mill out there! You are NEXT!

September 24, 2010

Michael J. Williams
President and Chief Executive Officer
Fannie Mae
3900 Wisconsin Avenue, N.W.
Washington, D.C. 20016

Dear Mr. Williams,
We are disturbed by the increasing reports of predatory 'foreclosure mills' in Florida working for Fannie Mae servicers. Foreclosure mills are law firms representing lenders that specialize in speeding up the foreclosure process, often without regard to process, substance, or legal propriety. According to the New York Times, four of these mills are both among the busiest of the firms and are under investigation by the Attorney General of Florida for fraud. The firms have been accused of fabricating or backdating documents, as well as lying to conceal the true owner of a note.

Ally Told Freddie Mac of Faulty Foreclosures Weeks Ago
By Lorraine Woellert and Dakin Campbell
Sept. 24 (Bloomberg) -- Ally Financial Inc.'s GMAC Mortgage unit told Freddie Mac that foreclosures by the auto and home lender might have been faulty weeks before halting its own evictions, according to two people briefed on the matter.
Ally informed Freddie Mac on Aug. 25 that affidavits for court proceedings might not be valid, according to a person with direct knowledge of the matter. By Sept. 1, Freddie Mac had notified its network of lawyers and stopped related foreclosures and evictions, said the person, who declined to be identified because the matter hasn't been formally disclosed. GMAC told agents to halt evictions in 23 states on Sept. 17.

California AG calls for Ally financial foreclosure freeze
TheTruthAboutMortgage.com
California Attorney General Jerry Brown today called on Ally Financial, formerly GMAC, to immediately prove that it is complying with state law, or cease and desist from foreclosing on homes in the state.
State law prohibits mortgage lenders from recording notices of default (NODs) on mortgages originated between January 1, 2003 and December 31, 2007, unless the lender contacts or makes a "diligent effort" to contact the borrower to determine loan modification eligibility.

GMAC Halts Evictions Related to Foreclosures in 23 States
When News of Forged and Robo-Signed Documents Comes Out
Martin Andelman
I'm sorry, but is GMAC ... no, wait ... Ally Financial ...I keep forgetting they're my "ally" now ...run by a 40 Mule Team of morons? Don't answer that, it was clearly rhetorical.
Okay, so here's the story ... some attorneys representing homeowners in foreclosure noticed that GAMC was saying things that weren't true, which is sometimes referred to as "lying," and then in a deposition it came out that a middle manager at GMAC was actually signing 10,000 foreclosures a month without reading the paperwork like he was supposed toÉ or, one might consider ... like any normal human being would do given they had a job signing 10,000 of anything each month. I mean ... what the ... can you even imagine?

Administration Issues Housing Market Scorecard for September
by Jann Swanson - MortgageNewsDaily.com
The Obama Administration's September Housing Scorecard produced by the Departments of Housing and Urban Development (HUD) and Treasury continues to paint a picture of a slowly stabilizing housing market, with slight marginal improvements in many areas.Even the bad news such as housing sales was mitigated by a reference to more recently released information.

Mortgage Delinquencies Drop, as Foreclosures Jump
By Jeffrey Sparshott
A government report Friday said the number of seriously delinquent mortgages fell in the second quarter for the first time in more than a year, reflecting a surge in completed foreclosures as well as lower monthly payments as homeowners negotiated loan modifications.
But while the fall in serious delinquencies - mortgages that are 60 or more days past due - is positive, the overall home lending picture remains uncertain, said Bruce Krueger, a mortgage expert at the Office of the Comptroller of the Currency. "There are mixed signals right now," Krueger said.

GMAC's Errors Leave Foreclosures in Question
By DAVID STREITFELD - NYTimes.com
The recent admission by a major mortgage lender that it had filed dubious foreclosure documents is likely to fuel a furor against hasty foreclosures, which have prompted complaints nationwide since housing prices collapsed.
Lawyers for distressed homeowners and law enforcement officials in several states on Friday seized on revelations by GMAC Mortgage, the country's fourth-largest home loan lender, that it had violated legal rules in its rush to file many foreclosures as quickly as possible.

Author explores contradictions of 'company towns'
By Steve Weinberg Special for USA TODAY
Hardy Green begins his seriously conceived, breezily written study with a built-in contradiction: "Company towns are un-American - and they are the essence of America."
Green, a former BusinessWeek magazine editor with a doctorate in U.S. history, opens the book with the example of Butte, Mont., a town pretty much created and run by Anaconda Copper. He covers 50 more before ending the book, including Hershey, Pa.; Gary, Ind.; Corning, N.Y.; and Ludlow, Colo.

Census Bureau Poverty Rate
Drastically Undercounts Severity of Poverty in America
By David DeGraw, AmpedStatus Report
While the shocking new poverty statistics from the Census Bureau indicating that a record 43.6 million Americans lived in poverty in 2009 emphatically demonstrates the severity of the economic crisis, the Census is drastically undercounting this demographic. Apparently government poverty statistics are as accurate as their unemployment statistics.
I have read many reports that simply restate what the government has said without questioning the fact that the metrics they use to calculate poverty are extremely outdated.

Wealthbridge Mortgage laying off 109
PORTLAND BUSINESS JOURNAL
Wealthbridge Mortgage Corp. will lay off its staff after a deal to sell the Beaverton mortgage company failed to close on Sept. 20.
Wealthbridge already has laid off 16 employees and will lay off the remainder of its 109-member staff on Oct. 15, according to a notice filed with the state under the Worker Adjustment and Retraining Notification Act.
"Wealthbridge Mortgage Corp. intends to close its business and permanently lay off employees due to unforeseen circumstances outside of the company's control and its inability to obtain the necessary capital to remain in business," President Scott Everett said in a letter to local and state officials.

Unemployment filings jump back up
By Annalyn Censk
NEW YORK (CNNMoney.com) -- Initial filings for unemployment insurance ticked up in the latest week, but continued to hover in the same range they have been since November, the government reported Thursday.
The number of first-time filers for unemployment benefits rose to 465,000 in the week ended Sept. 18, the Labor Department reported Thursday.
The number was higher than economists' forecasts of 450,000 for the week, according to consensus estimates by Briefing.com. It also marked an increase from the upwardly revised 453,000 initial claims filed in the previous week, which was shortened by Labor Day.

GM's IPO Will Likely Be Smaller Than First Planned
By DAVID SCHEPP - DailyFinance.com
General Motors' pending initial public offering of stock was expected to be one of the largest in history. At an anticipated $16 billion, the IPO would have been second only to the $19 billion stock offer by credit card giant Visa (V) in 2008.
But now, the nation's No. 1 automaker is revising its IPO expectations downward, anticipating it will bring in $8 billion to $10 billion when shares go public in November, Bloomberg News reports, citing unnamed people familiar with the matter.

Blast from the Past: A Warning about Socialism
Mises Daily: by Gene Epstein
Pictures of the Socialistic Future tells an engrossing story about a socialist paradise that swiftly degenerates into a societal dungeon. Originally published in an English translation back in 1893 - which adds immeasurably to its resonance - it has been reissued recently in paperback by the Ludwig von Mises Institute, a research center on free-market economics.
Utopian and dystopian fiction is often weakened by cardboard characters. Not so in this case. German author Eugene Richter (1838-1906), a libertarian politician and journalist none of us is likely to have heard of, was not only blessed with uncanny insight about the realities of socialism, he had a novelist's ability to create engaging characters.

Someone shut the lights off please!
We need a moratorium on government
by Marti Oakley - PPJ Gazette
It appears to get worse by the day; corrupt politics, corrupt politicians and an ever expanding and more threatening federal government.
I cannot think of even one person I have talked to or corresponded with, who has expressed even a modicum of fear over terrorism threats from some unknown mad man bent on killing us all off because they "hate us for our freedoms". The fear is prevalent in their conversations, generated by the continual onslaught of legislation and Executive Orders issued from a growing and malevolent government; it is this government who hates us for our freedoms. In fact, it isn't even that they hate us for our freedoms; they just hate us! While the Obama Administration was surely not the instigator of these assaults on the nation, he is happily following in the footsteps of his predecessor, George Bush the Lesser and his merry band of neo-cons, and has continued the destruction of the sovereign United States.

The Enraged vs. the Exhausted
If you thought the 1994 election was historic, just wait till this year. - By Peggy Noonan - WSJ.com $$
All anyone in America who cares about politics was talking about this week was the searing encounter that captured, in a way that hasn't been done before, the essence of the political moment we're in. When 2010 is reviewed, it will be the clip producers pick to illustrate the president's disastrous fall.
It is Monday, Sept. 20, the middle of the day, in Washington. CNBC is holding a town hall for the president. A woman stands - handsome, dignified, black, a person with presence. She looks as if she may be what she turns out to be, an Obama supporter who in 2008 put up street signs, passed out literature and tried to win over co-workers. As she later told the Washington Post, "I was thinking that the people who were against him and didn't believe in his agenda were completely insane."

Pentagon destroys thousands of copies of Army officer's memoir
By Chris Lawrence and Padma Rama, CNN
Washington (CNN) -- The Department of Defense recently purchased and destroyed thousands of copies of an Army Reserve officer's memoir in an effort to safeguard state secrets, a spokeswoman said Saturday.
"DoD decided to purchase copies of the first printing because they contained information which could cause damage to national security," Pentagon spokeswoman Lt. Col. April Cunningham said.
In a statement to CNN, Cunningham said defense officials observed the September 20 destruction of about 9,500 copies of Army Reserve Lt. Col. Anthony Shaffer's new memoir "Operation Dark Heart."

Cleaning Up the Toxic Legacy of Closed Military Bases
By BRUCE WATSON - DailyFinance.com
Military base closures can leave behind a toxic environmental legacy that's damaging and expensive to repair. In fact, the U.S. Force and Navy both rank among the top 100 polluters in America, and many of the bases they've left behind as a result of the BRAC closures have been declared Superfund sites by the Environmental Protection Agency.
For most of the 20 bases that are currently slated to close, their path to a post-military rebirth will likely involve some measure of environmental remediation conducted either by the military or by private contractors. Depending upon the level of pollution and the vitality of the community, waste cleanup can vary considerably. To get an idea of what's ahead for the bases slated to close, we've looked at two distinct cleanup cases: Loring Air Force Base in Limestone, Me., and Lowry Air Force Base in Denver.

G. Edward Griffin Weighs In On Obama's Executive Order and Codex!
By Barbara H. Peterson - Farm Wars - PPJ Gazette
After Barry Soetoro signed Executive Order #13544 on June 10, I wrote an article titled "Barry Soetoro, Imposter in Chief, Implements CODEX ALIMENTARIUS by Executive Order in the U.S.!" This article was published on June 14, and raised more than a few hackles. It was immediately rebutted on June 26 by Scott Tips of the National Health Federation in a press release titled "The Obama Executive Order - More Healthcare Bureaucracy, but Not Backdoor Codex."

The Road to World War III -
The Global Banking Cartel Has One Card Left to Play
David DeGraw
I: Economic Imperial Operations
When we analyze our current crisis, focusing on the past few years of economic activity blinds us to the history and context that are vital to understanding the root cause. What we have been experiencing is not the result of an unforeseen economic crash that appeared out of the blue with the collapse of the housing market. It was certainly not brought on by people who bought homes they couldn't afford. To frame this crisis around a debate on economic theory misses the point entirely. To even blame it on greedy bankers, while essentially accurate, also misses the most vital point.

Obama Focuses at UN on Mideast, Currency Friction With China
By Julianna Goldman and Kate Andersen Brower
Sept. 24 (Bloomberg) -- President Barack Obama used the backdrop of the United Nations General Assembly meeting to tackle tensions with China and to urge world leaders to support the Middle East peace process, two issues that are testing his economic and foreign policy plans.
The U.S. president pressed China's Premier Wen Jiabao over currency valuation during a two-hour meeting yesterday, an adviser said, as momentum is building in Congress for trade sanctions if the yuan remains what the U.S. views as undervalued.

Just in time for S.510: The EU will set world dairy standards
Europe to lead world dairy quality standards and welfare, says expert
By Mike Stones - PPJ Gazette
Europe will set the standard for the world dairy industry, specifically for milk quality and cow welfare, an international dairy expert has told a recent conference in Brussels staged by Pfizer Animal Health.
Ynte-Hein Schukken, professor of Epidemiology and Herd Health at Cornell University, US, told delegates that "Most of the milk produced throughout the developed world will be following the same standards as those set in the EU," according to UK farm publication Farmers Guardian.

Netanyahu Urges Abbas to Stay in Talks as Freeze Ends
By Gwen Ackerman and Flavia Krause-Jackson
Sept. 27 (Bloomberg) -- Israeli Prime Minister Benjamin Netanyahu urged Palestinian Authority President Mahmoud Abbas to press forward with peace talks after a 10-month partial moratorium on building in the West Bank came to an end.
"I hope that President Abbas will continue the talks and continue with me the path to peace that we began three weeks ago," Netanyahu said in a text message sent to journalists from his office.

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